Are most Americans ready for retirement? Are they calculating, accurately, what they might need to live on? For many middle-aged workers, retirement may seem like a while off. However, most people recognize that to live comfortably in retirement is to save while young and for many, the thought of not having a regular income can be anxiety-inducing. However, the 2016 Retirement Confidence Survey (RCS) reported that people are who are planning for retirement, and have retirement plans and savings, have higher confidence in retiring comfortably versus those who haven’t been able to save enough money. RCS says “…those without a retirement plan are far less likely than those with a plan to report assets of $100,000 or more (6 percent vs. 35 percent).”
The positive news is that RCS found that many Americans seem to be retirement-ready – or at least taking positive measures. The RCS survey cited that seven in ten workers are in fact saving for retirement. This figure is slightly below 2009 when 75% reported saving for retirement.
Despite the uptick in people preparing for retirement, there are still many who are not saving. RCS found that a significant number have less than $25,000 saved, excluding the value of their primary home and any defined benefit (DB) plans, according to RCS. Of that group, there are a substantial number of people who reportedly have less than $1,000 saved.
RCS reports that 78% of the employees surveyed are offered company-sponsored retirement plans such as a 401K, and 45% of these workers take advantage of such an opportunity. RCS also found that those with a 401K or IRA have more in their savings and investments for retirement – some in multiple vehicles and plans.
One of the issues, is that few people really understand how much they need for retirement. The RCS survey found that 48 percent of workers have never tried to calculate and their ideas of how much to save varies:
- Forty-seven percent of all workers think they need to accumulate at least $500,000 to live comfortably during retirement;
- Seventeen percent say they need between $250,000 and $499,999;
- Twenty-six percent think they need to save less than $250,000 for a comfortable retirement.
RCS also reported that people surveyed also stipulated they are taking multiple steps to save and plan for retirement including planning how they will occupy their time (67%); estimating their required income (49%) and 40% are calculating how much their social security will help them. However, only a handful of people from the survey said they spoke to a financial advisor to get more realistic information about retiring.
One of the ways investors are taking greater control of their personal investments (and getting retirement-ready) is with a physical possession IRA account. Depending on your personal income structure, either a Limited Liability Company or a Solo 401k can be used to control your retirement assets, and as a separate legal entity under your direction, whether you choose a Gold IRA or Silver IRA, you will likely find it is much easier to manage than traditional custodial accounts and you will likely discover you have more choices available and greater control over your own retirement savings.